EUR/USD and China

[AdamTrade]

Hi Enivid

Thank you very much.
Another question....I am concentrating on EUR/USD at the moment.
What is the correlation, if any, between this and China?
i.e. when the Chinese stock market moves, does EUR move in the same direction, like the 'commodity' currencies,
or is there no real link?
Just trying to build up a picture of what's driving FX at the moment.
Thanks

 

[Enivid]

There is correlation between China and EUR/USD but it is rather weak. USD will generally rise when Chinese stock market falls or China releases subpar economic indicators. The US dollar benefits from its safe haven status - investors selling Chinese assets are cashing out into dollars.

 

[Dakun Fredricks]

actually in this risk off mood people are using Euro as carry trade currency that is why it is getting benefited from worries over china as it is triggering risk off environment

 

[Enivid]

Euro as a carry trade currency? With interest rates at 0.05%, it's not a good fit for carry trade.